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Jan 22, 2013

Nigeria’s Corporate Affairs Commission and Job Creation

One of the things the
defunct administration of late General Sani Abacha did to encourage the
creation of jobs and reduce unemployment was ensuring that registering a
business name cost next to nothing. Sixteen years since the death of Abacha, it
could be said that the problem of unemployment has become dire not because of
the general assumption that the more we move into the future the difficult it
becomes to provide jobs as the population is growing but because we are the
Nigerians and know the reality in our own country. This explains why more needs
to be done by taking even more rational and courageous decisions in our quest
to tackle the problem of unemployment.

In Nigeria, the Corporate
Affairs Commission (CAC) is the body shouldered with the responsibility of registration
of companies. There are three categories of companies it registers. These
include Business Names, Limited and Trustees categories. Registering a business
name costs N5000. The Limited guarantee is again divided into sub-categories. The
lowest costs N40, 000 while a trustee category which is for non-profit
organizations like NGOs, churches and foundations, costs N120, 000 to register.
Recently, CAC has announced increases in the cost of registration. The
registration of business names has now gone up by 100%. The business name
category is actually the most critical that the unemployed engage to help them
start something that will generate income to themselves and eventually others.
It thus amounts to a violation of the wise reasoning and out of tune with the
current reality of chronic unemployment and the bitter consequences for our
country.

The primary responsibility
of every government is to make life comfortable to its citizens. The first step
towards achieving this is by creation of jobs for the citizens. It explains why
the cost of brand registration is cheap and affordable in most countries. In
the United States of America, the wealthiest nation on earth for instance,
registration categories are based on the limit of the territory of operation. A
company may want to operate at the national, state or municipal levels. These
cost $325 (N52, 000.00), $50 (N8, 000.00) and $25 (N4, 000.00) in that order.
Thus N10, 000.00 for the registration of a business name in Nigeria clearly
shows that the charge is skewed against the ordinary man.

The administration of
Goodluck Jonathan, more than any else in the history of Nigeria, is faced with a
stiffer challenge of job creation. The enormity of the problem is seen in the serious
breakdown of law and order accentuated by kidnappings for ransom, terrorism,
armed robbery and other grave vices in the country. As a result, increasing the
cost of company registration is a very irrational decision. A lot of people are
of the opinion that, given the current unemployment situation and its
consequences, this decision may not have come from the administration but from
within CAC and that the only reason why the commission would take that decision
will be because some individuals within the commission stand to benefit from
the decision. The implication is that there is a possibility not all the money
goes to the federation. Along that line, corruption is suspected. If the
federal government of Nigeria is paying the kind of huge salaries that is been
paid today, workers have no reason to use government offices to engage in
activities that badly hurt and frustrate the noble policies meant to support
progress in the country.

The News Tower was
registered as a business name in 2006. The name search and its registration
were completed in just two days. Today it takes not less than ten days for just
name search to be undertaken. This shows that the commission is becoming less
efficient. This is distressing for a nation that wishes to break into the rank
of twenty most developed economies in the world in just seven years time. It
takes competition to displace other nations within that bracket. The right
competition involves taking rational decisions. Part of rational decisions for
nations today is the decision to use available technologies. One wonders why
the duration of registration of companies is taking longer at a time when the
internet that can help accomplish such a process in one day is available.

With the right CAC website,
people can register companies in just one day and without paying cash directly
to any individual. The implication is that it will also work to prevent
corruption and the frustration it brings to progress. With the right website,
people can search the availability of company names and pay using ATM cards.
The registration certificate is generated automatically or sent via email as an
attachment. It is just like registering a domain name where you don’t get to
meet your web host yet the job is done. This also prevents corruption since the
government can decide to configuration the registration such that what is
charged from the ATM card is paid directly into the federal government’s
account rather than the commission’s account thereby cutting the commission from
any cash transaction. Furthermore, it will limit the manpower needed in the
commission since the bulk of the activity in the commission is undertaken by
the client themselves.

Going back to the cost of
registration of a company, one will say that lower charges will help the
country in more ways than many people will think. One thing about the
Information Technology (I-T) is that it has revolutionized every facet of life.
I-T is one reason why there are more musicians for instance. This is a category
of professionals that need property right protection for songs written and
names adopted. The government can, for instance, make a law mandating owners of
new songs to show evidence that they own the right to the songs and their own
names before any radio station can play such a song. Thus a radio station that
plays such music will be guilty of a criminal offence. Comedians are other
categories of persons that can be compelled by law to register names before
they can be allowed use those names to practice. These will generate more
revenue for the nation as long as the charges are affordable. In addition, it
will teach the young men and women the significance a lawful approach to
anything they do. One ugly trend that we have had to live with in Nigeria is
the tendency to ignore the law in our dealing and is badly shaping the mindset
of Nigerians.

Competing in the era of
I-T revolution cannot be successful without taking advantage of the technology
as the other nations we intend to displace at the higher rungs of the ladder
are taking advantage of it. There is the need for legislation to compel all
government ministries, departments and agencies to develop websites to aid
their services. In addition to the ability of the I-T to make operations easy,
it is critical in a country like ours where corruption has become a huge
stumbling block to progress.